Procurement

In a 2015 study by Nielsen, 66 percent of respondents were willing to spend more money with a brand committed to social responsibility. Across all industries, consumers are especially concerned with ethically sourced goods. But for many companies in the supply chain, sourcing remains one of the most difficult processes to audit and keep track of. Not only does this hinder a company’s ability to ensure ethical practices, but it also makes the sourcing process less efficient and more expensive than it needs to be. However, many businesses are turning to eSourcing tools and procurement software to solve this issue.

The term procurement is a tricky one. It may be an essential process for businesses, but few have a full understanding of it. In fact, it’s often used interchangeably with purchasing, despite the two occupying different roles. While purchasing is a very cut and dry practice – it focuses on money spent and goods acquired – procurement is a much broader responsibility.

Digitalization: Integration of digital technologies into everyday life by the digitization of everything that can be digitized. (via Business Dictionary)

With definitions like the one above, it’s no wonder so many organizations struggle on the journey towards digital procurement. The problem is, it’s not just one thing we’re trying to wrap our brains around: we need to comprehend digital, digitization, AND digitalization. Seriously?

The basis for most of an enterprise’s contact with their procurement team lies in eProcurement technology. It’s supposed to be a one-stop shopping solution for distributed buyers that allows them to make approved purchases on their timeline, at their convenience, without having to check the contracts in the filing cabinet.

Kelly BarnerAmazon Business as Disruptor or Innovator in eProcurement?10.26.2017

Wouldn’t it be easier if there were some kind of treasure map for finding the best suppliers? As much as we all wish that X marked the spot, the reality is that sourcing suppliers is a little more complicated than that. But like a lot of today’s problems, someone thought “Wouldn’t this process be easier if we made software to help us out?” And so sourcing software development began.

The idea of using software for procurement is tied to several successful technological advances in business. From enterprise resource planning to maintenance software and supply chain tools, many of the most valuable digital resources that businesses have are aimed at automating their most important business processes. Since it’s such a valuable process of several businesses, procurement is no exception. With that in mind, eProcurement software would seem a very common-sense approach to purchasing for nearly any kind of business.

Over the last decade, the unstoppable march of globalization, market competition and rising prices have created a need for suppliers to be trained more effectively. When you add the shifting availability of raw materials to the equation, you have a department which should be embracing change in order to tackle some of these contemporary challenges.

It wasn’t so long ago that the term ‘business procurement’ referred to the straightforward, uncomplicated purchase of corporate resources. You had a purchasing department, and it was responsible for sourcing essential assets – be they software or operational equipment – and buying them at the best possible price.

Electronic procurement, which involves the sale of supplies or services digitally, was the logical next step in the field of supply chain management. As businesses strive to be more data-driven and agile, the need for scalable eProcurement tools that can integrate with ERP systems continues to grow.

Providing consistent service and high-quality products requires a streamlined supply chain that delivers cost-effective materials. While maximizing output and minimizing errors allows your business to stay ahead of the competition, how can you ensure your company procurement process supports an optimal level of efficiency?